McDonald's mandatory AI menu pricing drew a Sherman Act price-fixing suit

On October 2, 2026, Michael Thomas, a DeKalb, Illinois customer, filed Thomas v. McDonald's Corp. (No. 1:26-cv-13892, N.D. Ill.), a Sherman Act Section 1 class action alleging that McDonald's' machine-learning pricing engine — in use since at least 2019 and mandatory for roughly 14,000 US franchisees since January 2026 — operates as algorithmic price-fixing. The complaint says the engine trains on nonpublic store-level transaction data and produces location-specific recommendations that nearby stores selling identical items do not receive identically.

The suit landed nine days after a September 29, 2026 Reuters investigation documented the engine: Big Macs priced $5.69 at one Fresno store and $6.89 at another two miles away, and five franchisees saying McDonald's pushed the tool on them. On the August 4 earnings call, CEO Chris Kempczinski said only 60% of US stores offered the under-$3 menu as designed — and tied pricing non-compliance to lease-renewal conversations, which plaintiffs read as the mandate behind the 'tool, not a mandate' framing. The complaint cites a ~40% menu-price rise from 2019 to 2024 as the harm.

McDonald's denies the characterization and says franchisees set prices independently. The legal backdrop favors plaintiffs: on July 29, 2026 the Third Circuit revived Cornish-Adebiyi v. Caesars Entertainment, letting a hub-and-spoke algorithmic-pricing claim proceed on parallel conduct plus 'plus factors'. If the McDonald's case survives a motion to dismiss, the same theory reaches every franchised chain whose prices move through a shared vendor — Wendy's, Yum! Brands' KFC and Taco Bell, Restaurant Brands International's Burger King.

A federal price-fixing class action (No. 1:26-cv-13892, N.D. Ill.) seeking class-wide damages; menu prices up ~40% 2019–24 per the complaint.

About 95% of McDonald's 45,356 restaurants are franchised, so pricing power formally sits with independent owners — the very independence the algorithmic mandate erodes.

The engine pools nonpublic transaction data from would-be competitors and pushes location-specific prices; identical nearby stores get different recommendations.

Adherence was enforced: McDonald's tracked 'pricing non-compliance' and tied it to lease-renewal and new-opening conversations, per Reuters reporting cited in the suit.

The CEO's own concession — only 60% of stores followed the under-$3 menu guidance — handed plaintiffs a franchisor treating recommendations as obligations.

When a franchisor's algorithm sets every store's prices, 'independent franchisees' stops being a legal shield — pooled data plus mandatory recommendations looks like a cartel.

McDonald's says franchisees independently set menu prices and calls the engine a tool, not a mandate; the case seeks class certification, damages and injunctive relief. With the Third Circuit's Caesars ruling behind them, plaintiffs' theory now covers any franchised chain using a shared pricing vendor, and the FTC is weighing disclosure rules for algorithmic pricing. A Connecticut franchisee, George Michell, separately alleges the tool suggested an ~$18 Big Mac meal in his own suit against the company.